Destroying Democracy

When I was a kid, we were taught the importance of voting and the greatness of democracy. However, as I grew up I was exposed to an ever louder litany regarding the evils of government and the virtues of private enterprise. This year the Republican candidates are working hard to be the one who dislikes government the most and to promise that they will reduce the state more than any other candidate. Well, aside from defense and homeland security, of course. The Democrats have generally pushed to expand the state, but they have done little to create a favorable climate for democracy. This worries me.

I shall begin by noting the obvious: bureaucracies (public or private) seem analogous to people: unless properly maintained they tend to bloat, weaken, and slow down. As such, there is clearly a need to (as Socrates argued) keep an eye on the state and offer legitimate criticisms and corrections. There is also the added concern of corruption-money is a bit like termites: once it gets into a structure, it tends to start spreading until the whole thing is decayed and rotted.

Both the Democrats and Republicans are guilty of encouraging corruption and allowing the monied interests to dominate American politics. Fortunately, some Americans have begun to fight back against this. While today we see what some would call modern hippies protesting Wall Street, this could be the beginnings of a new movement that will push back the power of money and repair some of the terrible rot in our house of democracy. Naturally, more is needed than drum circles and other such things-what is needed is meaningful reform and the will to take on this corruption with courage and integrity. This, I am sure, will not arise from the established members of the political parties. The Democrats do make pious noises about it, but generally seem content to be part of the existing system (this includes Obama). The Republicans are quite active in simply making things worse under the banner of the Tea Party. The folks in the media largely seem to be going along with the establishment they are part of. While CNN has been accused of a liberal bias, in recent days the new morning folks have been making the disingenuous claim that the protestors do not know what they want. This is presumably to make them appear to be confused “hippies” who are just protesting in liberal ignorance. While these people do not have a detailed plan of reform, they do have clear goals-mainly to push back the corruption of our democratic system. That is a laudable goal, albeit one that will be hard to implement. After all, this is supposed to be a democracy and not a plutocracy.

While the Democrats are accused of adding to the state, the Republicans also do so-mainly under the guise of defense and security. However, the Republicans claim that they want to reduce the government. For example, Bachmann says she wants to eliminate the EPA. The Republicans also make a point of relentlessly attacking government and cast it as a great evil. On the face of it, it seems odd that folks who want to be in government are so intent to bash it. After all, if I was at a road race and someone spent her time telling me how awful running is while she was running, I would say the obvious “why the hell are you running?” Naturally, the Republicans say they are running so they can dismantle the state from the inside. This should worry us for two reasons. First, it seems like they are threatening to undermine democracy. Second, people who go into the system to fight it often end up simply becoming part of that system. That said, perhaps people can go into the system to make it better. There is, of course, a certain irony in hearing people talk about the founders with (alleged) reverence while promising to slash the government these people designed.

The Republicans have also been pushing to “reform” the voting laws. While countering fraud is fine, the main focus seems to have been on lowering voter turnout for the opposing party. To be fair to the Republicans, what they are doing now pales in comparison to the horrible Jim Crow laws of the Southern Republicans. But the fact that some Democrats once did something worse does not make what is happening today any less bad. This sort of tactic is a fundamental assault on the very foundation of democracy and must not be tolerated.

The Republicans have also pushed to make the state more business like. One problem with this is that it is based on the myth of private sector virtue and public sector vice. There is nothing inherent to the private sector that makes it better than the public sector (just look at all the inefficiency and corruption there). There is also nothing inherent to the public sector that makes it worse than the private sector. The quality of both private and public sectors depends on the quality of the people involved and the degree to which the people (customers or citizens) hold them to account. In the private sector this is done by customer choice (of course, some companies do not need to worry about this) and in the public sector it is done by voting. It is an amazing act of thought control that the Republicans have gotten so many people to repeat, zombie like, the mantra that private is good and public is bad. Such people fail to see that this is essentially accepting that a non-democratic, profit focused authoritarian system (the business model) is superior to the democratic system.

Of course, it could be argued that a democratic system is, in fact, an inferior system and that the authoritarian model is superior. Socrates argued against democracy in favor of rule by the best, so perhaps there is something to this claim. However, when people praise the private sector business model and say that the state should be run the same way, they need to keep in mind that this is not a democratic model and its main goal is profit and not the good of the people. Naturally, the Republicans also praise democracy while proposing a system that is fundamentally undemocratic. Interestingly, people uncritically accept this inconsistency-mainly because they hear what they want to hear (and have been conditioned to praise).

Let there be no doubt, democracy is in grave danger and the responsibility lies with us, the people, to defend and restore government of the people, by the people and for the people. And no, corporations are not people-no matter what bullshit the lawyers and politicians spew.

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Comments

“To be fair to the Republicans, what they are doing now pales in comparison to the horrible Jim Crow laws of the Southern Republicans.”

To be fair to the Republicans, it should be noted that Jim Crow was created and propagated mainly by Democrats:

In the 1870s, conservative white Democrats gradually returned to power in the Southern states, sometimes as a result of elections in which paramilitary groups intimidated opponents, attacking blacks or preventing them from voting. Gubernatorial elections were close and disputed in Louisiana for years, with extreme violence unleashed during the campaigns. In 1877, a national compromise to gain Southern support in the presidential election resulted in the last of the federal troops being withdrawn from the South. White Democrats had regained political power in every Southern state.[5] These conservative, white, Democratic Redeemer governments legislated Jim Crow laws, segregating black people from the white population.

Blacks were still elected to local offices in the 1880s, but the establishment Democrats were passing laws to make voter registration and electoral rules more restrictive, with the result that political participation by most blacks and many poor whites began to decrease.[6][7] Between 1890 and 1910, ten of the eleven former Confederate states, starting with Mississippi, passed new constitutions or amendments that effectively disfranchised most blacks and tens of thousands of poor whites through a combination of poll taxes, literacy and comprehension tests, and residency and record-keeping requirements.[6][8] Grandfather clauses temporarily permitted some illiterate whites to vote.

Voter turnout dropped drastically through the South as a result of such measures. For example, Alabama had tens of thousands of poor whites disfranchised.[9] In Louisiana, by 1900, black voters were reduced to 5,320 on the rolls, although they comprised the majority of the state’s population. By 1910, only 730 blacks were registered, less than 0.5 percent of eligible black men. “In 27 of the state’s 60 parishes, not a single black voter was registered any longer; in 9 more parishes, only one black voter was.”[10] The cumulative effect in North Carolina meant that black voters were completely eliminated from voter rolls during the period from 1896-1904. The growth of their thriving middle class was slowed. In North Carolina and other Southern states, there were also the effects of invisibility: “[W]ithin a decade of disfranchisement, the white supremacy campaign had erased the image of the black middle class from the minds of white North Carolinians.”[10]

Those who could not vote were not eligible to serve on juries and could not run for local offices. They effectively disappeared from political life, as they could not influence the state legislatures, and their interests were overlooked. While public schools had been established by Reconstruction legislatures for the first time in most Southern states; those for black children were consistently underfunded compared to schools for white children, even when considered within the strained finances of the postwar South. The decreasing price of cotton kept the agricultural economy at a low.

In some cases, progressive measures intended to reduce election fraud, such as the eight box law in South Carolina, acted against black and white voters who were illiterate, as they could not follow the directions.[11] While the separation of African Americans from the general population was becoming legalized and formalized during the Progressive Era (1890s–1920s), it was also becoming customary. Even in cases in which Jim Crow laws did not expressly forbid black people to participate, for instance, in sports or recreation, the laws shaped a segregated culture.[3]

In the Jim Crow context, the presidential election of 1912 was steeply slanted against the interests of black Americans. Most blacks still lived in the South, where they had been effectively disenfranchised, so they could not vote at all. While poll taxes and literacy requirements banned many poor or illiterate Americans from voting, these stipulations frequently had loopholes that exempted white Americans from meeting the requirements. In Oklahoma, for instance, anyone qualified to vote before 1866, or related to someone qualified to vote before 1866 (a kind of “grandfather clause”), was exempted from the literacy requirement; the only persons who could vote before that year were white male Americans. White Americans were effectively excluded from the literacy testing, whereas black Americans were effectively singled out by the law.[12]

Woodrow Wilson, a Southern Democrat and the first Southern-born president of the post-Civil War period, appointed Southerners to his Cabinet. Some quickly began to press for segregated work places, although Washington, D.C. and federal offices had been integrated since after the Civil War. In 1913, for instance, the Secretary of the Treasury William Gibbs McAdoo – an appointee of the President – was heard to express his opinion of black and white women working together in one government office: “I feel sure that this must go against the grain of the white women. Is there any reason why the white women should not have only white women working across from them on the machines?”[13]

Wilson introduced segregation in federal offices, despite much protest.[14] He appointed segregationist Southern politicians because of his own firm belief that racial segregation was in the best interest of black and white Americans alike.[14] At Gettysburg on July 4, 1913, the semi-centennial of Abraham Lincoln’s declaration that “all men are created equal”, Wilson addressed the crowd:

How complete the union has become and how dear to all of us, how unquestioned, how benign and majestic, as state after state has been added to this, our great family of free men![15]

A Washington Bee editorial wondered if the “reunion” of 1913 was a reunion of those who fought for “the extinction of slavery” or a reunion of those who fought to “perpetuate slavery and who are now employing every artifice and argument known to deceit” to present emancipation as a failed venture.[15] One historian notes that the “Peace Jubilee” at which Wilson presided at Gettysburg in 1913 “was a Jim Crow reunion, and white supremacy might be said to have been the silent, invisible master of ceremonies.”[15] (See also: Great Reunion of 1913)

Early attempts to break Jim Crow

The Civil Rights Act of 1875, introduced by Charles Sumner and Benjamin F. Butler, stipulated a guarantee that everyone, regardless of race, color, or previous condition of servitude, was entitled to the same treatment in public accommodations, such as inns, public transportation, theaters, and other places of recreation. This Act had little impact. An 1883 Supreme Court decision ruled that the act was unconstitutional in some respects, saying Congress was not afforded control over private persons or corporations. With white southern Democrats forming a solid bloc in Congress with power out of proportion to the percentage of population they represented, Congress did not pass another civil rights law until 1957.

Only the Tea Party cares about this, and they are called “extremist” for caring:

America has now officially closed the books on the 2010-2011 fiscal year. It is only fitting that the last day of the year saw the settlement of all outstanding and recently auctioned off debt. The result: a surge of $95 billion in total government debt overnight, and a fiscal year closing with the absolutely unprecedented $14,790,340,328,557.15 in debt. Net net, in the past fiscal year, the US has issued a total of $1.228 trillion in new debt and has accelerated over time. At a rate of $125 billion per month, total US debt to GDP will pass 100% in just over a month. Incidentally, one may inquire about the benefits of centrally planned fiscal stimulus (cough Solyndra cough): the US economy added over 3$ trillion in debt in the past two years and the stock market is almost back to where it was back then. Perhaps it is about time someone demanded that all those lunatics who say that issuing debt for the sake of growth (and pushing the S&P higher of course) be finally locked away in perpetuity, and the key dropped into the deepest volcano in Mordor.

“It is an amazing act of thought control that the Republicans have gotten so many people to repeat, zombie like, the mantra that private is good and public is bad.”

No, Mike. We fully realize that both are made up of people. But it does seem that the public sector does not offer people nearly as much choice as the private sector. And because profit is not a concern for the public sector, it is prone to much waste. What is the motive for good in the public sector? I realize that is need not be money, but could not people in the public sector have those same, non-monetary motives? Could it be that not 100% of all motive in the private sector is money?

Now, let’s turn your above statement around. I think it fits you and the Democrats. Afterall, this country did elect a Democrat and far-left liberal as President.

“It is an amazing act of thought control that the Democrats have gotten so many people to repeat, zombie like, the mantra that public is good and private is bad.”

I’m of the opinion that democracy is not good in all situations–but in America, with it’s cultrue and level of compentency it is by far the best form of government. Democracy to undeveloped cultures is like quantum mechanics to 2nd graders. They don’t understand it enough to make good use of it.

Obama’s going down so Democracy is in grave danger? You realize the protesters were pro-Obama, right? Well, other reports say they were anti-government. In either case, they don’t fit your idealized view.

Democracy is not in grave danger. You’re being sucked under another wave of media hype. Turn off the television and stick to xbox; I did and feel better.

I do make such a case. Consider, for example, the role of corporate money in the system. Our “leaders” are generally more responsive to these interests than to the general good of the people. This is not a liberal/left conspiracy thing-there are traditional conservatives who are expressing the same concern. See, for example, Buddy Roemer. He is hardly a wacky lefty.

Sigh…More sophistry trying to masquerade as philosophy. You don’t understand the Republican (or libertarian for that matter) point of view because you willfully choose not even to try. Yes, it does seem counter-intuitive to oppose government growth from the inside, but have you considered the consequences of attempts to change government from the outside? How do you get from saying that those who favor limited government want to “undermine democracy”? Sophistry. And again, this is absurd given the arguments by some Democrats, many of their fellow travelers in the media and in “social services”, many Philosophers, and by implication, even you yourself that democracy is possibly inferior to a society governed by elites or Philosopher Kings or such.

I’m reasonable good at seeing different perspectives, thanks to my academic training and my years as a dorky gamer.

I have considered the various ways of changing the system regarding interior versus exterior. For example, Socrates and Sarah Palin both advocate change from the outside, Thoreau and King advocate defying the system with civil disobedience, and the anarchists advocate change via action from the outside. However, when people routinely attack the institution of the state that indicates that they are against it. Limited government is fine-but look carefully at how they actually operate and what they do.

Democracy would be inferior to a state governed by the very best of people acting for the best. However, as Plato himself noted, that is pretty much an unlikely ideal. From a practical standpoint I am with Locke, Jefferson and the others: the state should be designed to minimize the evils that can be done within and by the state.

“However, when people routinely attack the institution of the state that indicates that they are against it. ” It indicates that they are against what specific state institutions are doing. It does not indicate that they are opposed to democracy or seek to bring down the entire US government. There are plenty of Democrats and fellow travlers, not to mention college professors, who are MUCH more strongly in favor of destroying our government and are FAR more hostlie to democracy.

Sarah Palin is a politician who has run for and been elected to government office. Absurd that you would put her in the “outsider” context here, yet by implication above you insinuate that those who seek limited government via the means of government are “insiders”. Seriously. You. Can’t. Be. That. Thick. Sophistry.

Judging from practically every other article you post, including this one, your standing with Locke, Jefferson, et al on minimizing the role of the state is simply lip service. Don’t piss on our society and tell us its raining.

As I’ve said before, the US is in a far worse condition that you can imagine. The Occupy Wall Street group was funded by AdBusters which is funded by the Tides Foundation. Tides funds far left wing groups of young radicals to push its far left agenda, because the young activist are too ignorant to know they are being used as a street-based lobby effort by the wealthy far left foundations, such as Tides. The goal is to threaten disorder if this leftist agenda is not adopted by Washington.

To make matters worse, the originally anti-war Tea Party was co-opted by the Republican Pro-Israel warmongering Neocons and transformed into the new Pro-Israel warmongering Teaocons, which are funded by far left organization like the Koch Brothers, in order to push Washington to the right and into more war for Israel.

People who are serious about taking this nation back for the People are strategizing now…not beating drums in a drum circle. Such people include many very unhappy people within the US military and intelligence who are organizing a coup d etat, which will occur if and when a civilian leadership that rejects Israel and the Israel-serving Washington establishment cannot be organized, and soon.

This is why we are organizing Summer of Justice – 2012 – DC, which is set for next July 4. This is a nonviolent gathering that will an alternate civilian government with the backing of police and military. If it fails, expect the coup.

The Cloward-Piven strategy has deeply influenced community organizers ever since. It informs all of Piven’s work, even her apparent turn to a more conventional voter-registration strategy in later years. And of course Piven’s current call for strikes, riots, and disruptive protests by America’s unemployed is a direct descendant of the original Cloward-Piven strategy.

Stelter’s New York Times story provides the following excerpts from Piven’s Nation column: “an effective movement of the unemployed will have to look something like the strikes and riots that have spread across Greece,” and “protesters need targets, preferably local and accessible ones.” When, in reply to questioning from Stelter, Piven claims, “That is not a call for violence,” Stelter leaves her denial unchallenged. Yet a call for riots on the model of the ones seen recently in Greece manifestly is a call for violence.

And to think the Tea Party is called “extremist” for wanting the government simply to live within its means.

Proposed List Of Demands For Occupy Wall St Movement!

Demand one: Restoration of the living wage. This demand can only be met by ending “Freetrade” by re-imposing trade tariffs on all imported goods entering the American market to level the playing field for domestic family farming and domestic manufacturing as most nations that are dumping cheap products onto the American market have radical wage and environmental regulation advantages. Another policy that must be instituted is raise the minimum wage to twenty dollars an hr.

Demand two: Institute a universal single payer healthcare system. To do this all private insurers must be banned from the healthcare market as their only effect on the health of patients is to take money away from doctors, nurses and hospitals preventing them from doing their jobs and hand that money to wall st. investors.

Demand three: Guaranteed living wage income regardless of employment.

Demand four: Free college education.

Demand five: Begin a fast track process to bring the fossil fuel economy to an end while at the same bringing the alternative energy economy up to energy demand.

Demand seven: One trillion dollars in ecological restoration planting forests, reestablishing wetlands and the natural flow of river systems and decommissioning of all of America’s nuclear power plants.

Demand eight: Racial and gender equal rights amendment.

Demand nine: Open borders migration. anyone can travel anywhere to work and live.

Demand ten: Bring American elections up to international standards of a paper ballot precinct counted and recounted in front of an independent and party observers system.

Demand eleven: Immediate across the board debt forgiveness for all. Debt forgiveness of sovereign debt, commercial loans, home mortgages, home equity loans, credit card debt, student loans and personal loans now! All debt must be stricken from the “Books.” World Bank Loans to all Nations, Bank to Bank Debt and all Bonds and Margin Call Debt in the stock market including all Derivatives or Credit Default Swaps, all 65 trillion dollars of them must also be stricken from the “Books.” And I don’t mean debt that is in default, I mean all debt on the entire planet period.

Demand twelve: Outlaw all credit reporting agencies.

Demand thirteen: Allow all workers to sign a ballot at any time during a union organizing campaign or at any time that represents their yeah or nay to having a union represent them in collective bargaining or to form a union.

These demands will create so many jobs it will be completely impossible to fill them without an open borders policy.

What a surprise. A lot of free stuff. Just like what the people in London were rioting over. Some of these “requests” are outrageous and demostrate that I was correct in many of my assumptions about those protesters.

Yeah, but they’re all highly educated. See the rants about student loans? What kind of classes do you suppose they spent that money on? Who do you suppose will ultimately foot the bill for those loans when these people who are so expensively miseducated can’t get jobs to pay them off? Who ultimately benefitted from all that coin? As the lefties say, follow the money.

My guess is they they are mainly a bunch of art history majors who partied for six years while in college, and now realize that 1) they have to pay the money back, and 2) their degree isn’t worth much in terms of finding gainful employment.

In any case, a person’s major is not the major factor in their job chances. After all, a BA is a BA, (same for BS) with some exceptions regarding highly specialized fields (like engineering). Most of the hours students have are essentially the same. As one of my colleagues says, a BA/BS is just some evidence that a person can be educated/trained to be a professional.

Maybe in your world. Out here in reality, BS in chemistry, with a little extra training/effort but not an MS, can well get you a job in some fields of Engineering. A BS in Engineering, with a little extra training/effort but not an MS, can well get you a job in Computer Sciences. A BS in zoology is a looong way from Engineering or Computer Science. I suppose you could quibble about the edges of my point, but in general I would hazard a bet that in such a poll as you suggest the ratio of serious BS majors to BA majors and weaker BS majors in the mobs in question approaches zero.

Ran across a web page you may have already seen, where these “99%”ers have posed with their scribbled out sob stories. Few of these measure up to the stories of my parents, relatives, many of my immigrant coworkers, disabled friends and coworkers that I know and have known, possibly some people who comment here, and even in some instances myself, all of whom have achieved various degrees of success. The difference is the successful don’t give up and feel sorry for themselves. When they encounter failure, they pick them selves up, dust themselves off, and start over again. “The fault, dear Brutus, lies not in our stars, but in ourselves if we are underlings.”

And BTW, I’m certainly not the 1% and I’m certainly not these protesters so I suppose people like me don’t exist.

I can imagine Sinatra crooning, “I pick myself up. . . .” and finishing with “The fault, dear Brutus, lies not in our stars, but in ourselves if we are underlings.”

But. Alas. No. The original sentence reads as follows: “The fault, dear Brutus, lies not in our stars, but in ourselves , THAT we are underlings.” Great debates have been held over the interpretation of the Second Amendment commas that create the ambiguity in the phrase “‘. . .,the right of the people to keep and bear arms, . . . .” Commas, and words, are important. Changing them, or omitting them, can change or destroy meaning. The following is a howler. Check it out.

You omitted a comma and changed “that” to “if”. The word “that” implies that we really have no choice. We ARE underlings. What would Shakespeare (or whoever wrote those plays) have to say about the choice of the word “if”? That word choice implies that we can choose to be underlings or not to be underlings, or that there’s some doubt that we are underlings.

Why the hostility towards the protestors? Sure, some of them say some odd and even foolish things. But many of them say rather sensible things-things that conservatives used to say. Look, for example, at Teddy Roosevelt.

Is this not how democracy is supposed to work? People express their views peacefully and they are subject to debate in the society and then considered (or not) by the governing bodies?

While I disagree with some of the Tea Party (and was dismayed when some of it was assimilated by the Republicans and became something of a tool of the wealthy), it was great seeing an active movement in which people cared enough about political issues to get out and be heard. I regard the Occupy Wall Street movement the same way. They are Americans who have a complaint and are actively engaged in the political process. Even people who disagree with them should be pleased that some people are shedding the cocoon of apathy. The folks who do like what they have to say can, of course, start their own movement to counter them.

Of course they are allowed (and even encouraged) to express their view peacefully, and they are even allowed to dress up like zombies…

Of course, we in turn are free to ridicule their views. I think Demand eleven is especially ridicule worthy:

Demand eleven: Immediate across the board debt forgiveness for all. Debt forgiveness of sovereign debt, commercial loans, home mortgages, home equity loans, credit card debt, student loans and personal loans now! All debt must be stricken from the “Books.” World Bank Loans to all Nations, Bank to Bank Debt and all Bonds and Margin Call Debt in the stock market including all Derivatives or Credit Default Swaps, all 65 trillion dollars of them must also be stricken from the “Books.” And I don’t mean debt that is in default, I mean all debt on the entire planet period.

Demand 11 would have disastrous consequences if it were accepted (which it most certainly will not-after all, corporations get bailouts, not real people). While there are some unfair debts, there are many debts that are quite fair and hence must be repaid (like my own credit card debt). Also, this would wreck not just the “big bad corporations” but also destroy the small town credit unions and the entire practice of lending.

I remember thinking such things when I was a Freshman and I understand the sentiment and idealism. However, I have learned the importance of tempering idealism with some critical assessment.

It is worth noting that one absurd demand does not contaminate the rest.

TJ: Demand eleven: You still haven’t mentioned that were these demands PROPOSED (by LLoyd J Hart, whoever he is) but that they appeared, as posted by Anonymous,AND were preceded by the following disclaimer:

“Admin note: THIS IS NOT AN OFFICIAL LIST OF DEMANDS [boldface in original]. This is a forum post submitted by a single user and hyped by irresponsible news/commentary agencies like Fox News and Mises.org. This content was not published by the OccupyWallSt.org collective, nor was it ever proposed or agreed to on a consensus basis with the NYC General Assembly. There is NO official list of demands.”

You seem to still be ignoring that paragraph so that you will still have a ‘story’ to tell. Some sort of goofy windmill to tilt at. What is the point of describing what the “potential” results of an UNofficial “Demand”, written by a virtual unknown (Lloyd J Hart*), and posted by “anonymous” might be IF it were acted upon? Reading your last paragraph here is like watching a flaming straw man sliding out of control down his own slippery slope.

It’s entertaining as hell.

*If this guy even exists except in reference to being the purported author of these demands, I’d like to see proof. More than likely he’s the product of some conservative’s fevered imagination.

Even better than the DEMANDS? Say it ain’t so. Are we going to have to extinguish yet another strawman?
So, who is Lloyd J Hart? Perhaps he’s the ‘fart smeller”?
Speaking of which, I smell another ever reliable source: The Post.

At this nascent grassroots stage, the movement (heh, movement–fart) is more street theater than political rally. Hold yer nose and get used to it

Almost all political movements attract a fringe-see, for example the Tea Party. However, the validity of a movement is not defined by the fringe elements that wander around its edges, but by the core. If the movement were about smelling farts, then it would be absurd and could be dismissed as mere wackiness. However, it is clearly not about that-no more than the Tea Party is defined by the racists who gather at its fringes at events.

Even if we assume that they are spoiled brats, it would be a mere ad hominem to dismiss their claims on such grounds. Also, the most spoiled of brats seem to be the fattest of cats who are being protested against.

TJ: You should have mentioned the first time not only that the demands were PROPOSED (by LLoyd J Hart, whoever he is) but that they appeared, as posted by Anonymous,and were preceded by the following disclaimer:

“Admin note: THIS IS NOT AN OFFICIAL LIST OF DEMANDS [boldface in original]. This is a forum post submitted by a single user and hyped by irresponsible news/commentary agencies like Fox News and Mises.org. This content was not published by the OccupyWallSt.org collective, nor was it ever proposed or agreed to on a consensus basis with the NYC General Assembly. There is NO official list of demands.”

You conveniently omitted that disclaimer. Of course, if you had included it, it wouldn’t have fit your story line. Why, if you had not remembered to provide the link, eventually, we’d have never known the full story. Did you get this from Mises.org or Fox News?

I think I’ll take the WTP route (partially, and at least in my case justifiably, I believe) and forgo your video and long, cut and paste offerings for the time being. Why, even in that 6:44am offering of yours–a foot plus an inch or two of text on my screen–you omitted the most important part.

John Bogle on Wall Street circa 2006. This is the real problem with Wall Street, but no one is addressing it:

But Bogle isn’t seduced. He offers a stinging indictment of corporate excess and a Cassandra-like warning to individual investors. He invokes ancient history to remind us that “no nation can take its greatness for granted.” Bogle, creator of the first index fund, pleads with investors to pay attention to what’s happening with their money or risk losing it to corporate managers with dubious motivations.For years, says Bogle, the U.S. had a system in which capital was the property of owners. Those who bore the risk reaped the rewards. That system, which he calls the ownership society, has been transformed in the past 50 years into the so-called agency society. Now investors swallow the risk while managers collect more than their fair share of the rewards. Along with that has come the era of phony accounting, stock-option mania and inflated executive compensation.

A similar transformation has taken place in the mutual-fund world. Bogle frowns on the trend of fund managers flipping stocks to juice their returns and running up transaction costs in the process. Such activity isn’t in the long-term interest of shareholders. And when fund companies then charge investors excessive fees, it chips away at overall returns undermining the entire investing process.

“The ownership society is dead,” says Bogle, who still keeps an office at Vanguard’s Valley Forge, Pa., headquarters even though he long ago gave up the roles of chairman and chief executive. “And the agency society isn’t working, so the task and it’s a huge, huge task is to develop a fiduciary society that honors trustees.”

How to do that? Bogle advocates federal legislation that requires fund directors to serve solely the interests of fund shareholders, an endeavor that will bring about what he calls shareholder democracy. SmartMoney.com spoke with Bogle about what’s wrong with investing in America and how to fix it.

SmartMoney.com: How has capitalism veered in the wrong direction?

John Bogle: What I tried to do in the book I don’t think has been done before. All these systems are interlinked: the systems of corporate America, investment America and mutual fund America. They intersect to put the shareholder in the back seat. He ought to be up front, in the driver’s seat….

Capitalism has changed into a new system, which is not a good system. It’s a managers’ system. The rewards have to go to the people who assume the risk; that’s conventional capitalism. It’s been taken over, most notably in mutual fund America. By far too large a share of rewards has gone to the managers. There are lots of reasons for that, but the main reason is that we don’t really have an ownership society. It’s gone, and it’s not coming back. Fifty years ago individual investors directly owned 91% of all stock. In 1985 the balance changed and institutions owned more than 50% of all stock. Now 68% of all stock is held by institutions, and only 32% is held by individuals.

SM: Why the shift?

JB: It’s because of a single principle, which is as old as the Talmud, and that’s diversification. Most people do not have the capacity to diversify on their own. They do it through mutual funds. They’re doing the right thing, but the system isn’t working. We’re becoming an agency society, where agents aren’t representing the principals. They’re representing themselves. I quote Adam Smith in the book: We can’t expect people to look after other people’s money with the same care they look after their own money. Interests are conflicted.

SM: Explain the rent-a-stock industry vs. own-a-stock industry you talk about in the book.

JB: In 1950, when I started in this business, there was an average six-year holding period for stocks [by a mutual fund]. In the last 10 years turnover [has increased to] 100% annually. It can easily be called a rent-a-stock industry. You know [former Treasury Secretary] Larry Summers’ statement: No one has ever washed a rental car. Why would you take the trouble? We aren’t owners.

SM: Why is the increasing concentration of stock ownership such an insidious development?

JB: The problem is that we have profound conflicts of interest as agents. Money managers nearly all of them are managing both mutual funds and pension funds. So there’s not much of a distinction out there from an investment standpoint. The 100 largest institutions own about 58% of all corporate U.S. stocks. That’s an amazing concentration. They’re managing 401(k) plans and pension plans. They don’t want to lose their clients. The managers don’t want to offend their clients; and they don’t want to offend two types of clients actual and potential. They don’t want to offend anybody.

In my time in this business, investment management has gone from a profession with elements of a business to a business with elements of a profession. Now the dominant form of management is the giant financial conglomerate. Companies, in effect, own themselves. Citibank, for example, holds 1% of Citigroup. They’re all members of the Business Roundtable [an association of CEOs of leading U.S. corporations]. Members of the Roundtable own each other; corporations own about 12% of corporate shares. Another 11% they arguably control by having moral suasion. That 12% is in their pension plans, the other 11% is in their 401(k) plans. They have enough power to be pretty confident that those 401(k) managers are not going to take them on over any issue…. Agents’ and managers’ interests are aligned. What I argue in the book is that the ownership society is dead. And the agency society isn’t working, so the task and it’s a huge, huge task is to develop a fiduciary society that honor trustees. That’s best done with a federal statute of fiduciary duty.

SM: In the book you make comparisons between today’s executive compensation excesses and the age of the robber barons.

JB: I talk about the compensation for chief executives. In the book I say the top earners have 430 times the compensation of the average worker. It’s like a second Gilded Age.

We have to allow some form of shareholder democracy. It’s still a stock market with the idea of a republic. Just like our nation we don’t vote on every issue, we elect representatives to vote for us.

SM: How would that logistically be carried out?

JB: You have to have access to the proxy. We ought to have shareholders who have 5% of stock be able to elect directors for the company. The Business Roundtable hates it. They don’t want anybody else nosing into their business. They don’t like the notion that a boss of the business shouldn’t be boss of the board. The CEO is an employee of the company, employed by the company to do the best he can for shareholders. The SEC has tried to do something like that, but moved away from it.

to Walt Disney’s board]. The cards are stacked in the favor of management and against any form of corporate democracy. In a corporation, even if a majority of shareholders vote for a provision, under laws in most states the votes are nonbinding. The legal word is “precatory,” a word I hate. Those votes are only advisory to the corporation. We have to change that…. There need to be structural changes access to the ballot, requiring corporations to do what shareholders want. It will be hard, but that doesn’t mean we shouldn’t try.

We have to wake up our investors, particularly our mutual-fund investors. The industry is a clear case in which if fund investors move their money to those [mutual funds] doing the right things ones that have low costs, etc. then the system will change because individual investors will see the light. This is not going to be easy to do. There’s an educational issue there. However long this process takes, it is moving in the direction I’m suggesting. Investors will not ignore their own economic interests. It’s a glacially slow change because there are forces aligned against change by the oligarchs. I realize it’s a bit self-serving, but Vanguard is a manifestation of this. I don’t just talk this kind of talk. It’s what I did when I created Vanguard in 1974. It was run for owners, not for managers. It’s not owned by a giant conglomerate or family…. It’s truly a mutual-fund group. Our market share has increased every year for 23 years in a row.

SM: You criticize the rise of short-term speculation vs. long-term investment. But isn’t that just part of investors’ strategy to beat the market?

JB: Yes, but the buck you make is the buck I lose. It’s not balanced trade because of the man in the middle. It’s tax-inefficient. The records of mutual funds are far worse than they’re portrayed, because we look at pretax returns. In a roughly 13% stock market, the average mutual fund earns 10%, and the average mutual-fund investor earns 6.5%. That’s not good enough. And I haven’t even talked about taxes, which take out another 100 basis points…. That’s pretty stunning. This never would’ve happened if not for the greatest bull market in history. Managers’ fees didn’t matter because it didn’t feel like you were being cheated.

People understand the magic of compounding returns. But few investors know about what I call the tyranny of compounding costs…. You put up 100% of the capital and take on all the risk, but you get only 20-something percent of the return. That’s a system that is destined to fail. People will not be that dumb forever.